How We Started A $100K/Month Startup Incubator And Investment Fund
In this interview, Erik Brieva President and Founder of Bcombinator shares with Starter Story all the history of Bcombinator, the methodology applied for growing startups with success, some business tools/platforms, his books recommendations, and advice for future entrepreneurs:
Hello! Who are you and what business did you start?
I co-founded Bcombinator to help entrepreneurs to be even more successful than I have been. In my 20+ years as an entrepreneur, I have created 6 startups, scaled up 3 internationally, and successfully sold 4 (iSOCO to B2BFactory in 2001, Enzyme to Nexe Group in 2011, Polymita to Red Hat in 2012, and Strands to CRIF in 2020).
Currently, I continue to be the CEO of Strands, expanding the company to lead the digital transformation of the financial industry.
Bcombinator was launched in 2017. Since then, we have launched around 25 startups and have worked with more than 100 entrepreneurs, helping them with our different programs for incubation, acceleration, mentoring, training, networking, international expansion, technology, legal and financial advisory, co-working space, marketing, amnd sales.
What’s your backstory and how did you come up with the idea?
It all started in Havana, where, in parallel to my university studies in Maths and Computing at the prestigious University of Havana, I had to start doing any kind of business (buying and selling goods, tourist guiding, taxi driving) to help my family survive in the hard nineties.
In 1996, I won an innovation contest from the British Council and was awarded a scholarship to study for the master’s degree of my choice. That was my chance to go out of Cuba and did the MSc Computer Sciences at Middlesex University in London.
After finishing the master’s in 1998, I moved to Barcelona, Spain, and right away started planning to create a company to apply my computer science expertise in transforming businesses. Since then, it has been a long career of startup creation, growth, turnarounds, and successful exits.
Take us through the process of designing, prototyping, and manufacturing your first product.
Very early in my entrepreneurial career, I learned the importance of developing customers before products. So, in the case of the software companies (iSOCO, Polymita, Strands), the key has been the ideation and co-design with customers of the solutions to their business needs.
Then, prototyping and manufacturing have been iterative processes, from the MVP until obtaining a mature product. Then, through product maintenance, those keep evolving continuously during their lifetime and usage.
Three key advantages of co-designing and co-developing with your customers:
- Product-market fit is guaranteed, even before testing or launching the product,
- Funding is guaranteed for the product development and maintenance,
- You got your first customer references to attract new customers.
It is very important to make sure that your company holds the Intellectual Property. We ensured the ownership of the IP by granting those early customers an exclusive usage of the product in their main territory or market during a period of time, for example, during two years, so they could take advantage of their competitors.
Describe the process of launching the business.
Those previous business experiences of developing customers before products are aligned to the Lean Startup methodology brilliantly proposed by Eric Ries. Based on that premise, we launched Bcombinator as a hub for entrepreneurs that includes startup incubation and acceleration programs, an extensive network of experienced mentors, and an investment fund, among other facilities dedicated to helping startups.
After having mentored and invested separately in several startups, the Bcombinator’s founders decided to join forces putting together our experiences into a documented methodology (The Bcombinator Methodology), bringing our startups into a unified portfolio, and putting our money into a common fund.
Bcombinator has been self-funded until now, including buying and refurbishing a five-story building in an exclusive business district in Barcelona, a few meters away from the beach.
Since launch, what has worked to attract and retain customers?
Our customers are entrepreneurs that want to start up or scale up their business.
Some keys to attract and retain startups are:
- The reputation of Bcombinator and its founders
- References by other startups that are or have been part of Bcombinator
- Variety programs, activities, services, and facilities offered by Bcombinator
- Extensive network of world-class experienced mentors
- Bcapital fund to invest in early-stage startups
- Support throughout the life cycle of startups beyond the programs
- International connection and partnership agreements for global expansion
How are you doing today and what does the future look like?
Today’s Bcombinator is a lively hive of entrepreneurs innovating to solve the needs of their target markets.
To fuel, startups finding the product-market fit, and to accelerate their growth, five successful entrepreneurs from Barcelona, have launched Bcapital, an investment fund created by successful entrepreneurs to support new entrepreneurs in their career towards success.
Currently, we are fundraising for completing the investment vehicle to invest in the startups that pass successfully the Bcombinator’s Incubation Program. This vehicle consists of several one-million euro micro-funds, one micro-fund for every cohort of startups coming out of the incubation program.
Our goal is to invest in the best startups, particularly those that show a deep technological foundation and a high degree of disruption. But, above all, we invest in people, because in the stage in which we invest, it is possible that the model and/or the idea have to be pivoted, which is why our decision is based 60% on the team and 40% on the idea, the size, and the market dynamics.
In the future, Bcombinator will be expanding to other regions. We can see an interconnected and diverse Bcombinator’s community from cool places such as Barcelona, Bali, Cancún, Dubai, Havana, Las Terrenas, Lisbon, Miami, Tel Aviv, Rio de Janeiro.
Through starting the business, have you learned anything particularly helpful or advantageous?
If I would select one lesson learned from each different company, these would be:
From iSOCO, I learned the importance of developing customers before products. The initial idea was to develop intelligent software components, but very early we were dragged by the market demand and reacted fast to it, being able to deliver pioneer e-commerce solutions. Being funded by customers catapulted business growth.
From Polymita, it was decisive to bet on a multiproduct strategy. So we focused on continuously innovating and productizing the solutions for building the best product suite for Business Process Management. Being able to offer different solutions sharing a common technology platform, accelerated the time-to-market and increased the up-selling and cross-selling.
From Strands, the smart marketing investment combined with establishing partnerships with other players fueled the international expansion to cover all geographies with a team of just 120 people. Our marketing has always been diversified and very picky combining the best opportunities for inbound marketing, digital outbound, attending events, sponsoring conferences, customer references, analyst reports, etc. Our partnership strategy includes a wide range of possible partners such as other software vendors, financial institutions, consulting firms, system integrators, and even clients and competitors.
What platform/tools do you use for your business?
- Marketing Automation Sherparing
- Growth Hacking: FindThatLead
- Google Suite
- Internal Communication: Slack
- Project Management: Trello
What have been the most influential books, podcasts, or other resources?
I always find inspiration in The Little Prince, always curious and looking for answers, iterating among different worlds and learning from human nature. I can perfectly see the parallelism with creating your MVP, inquiring customers, and looking to find the product-market fit.
But when it comes to business reading, you can read my bookshelf here. These three movies also served as inspiration (“Pirates of Silicon Valley”, “The Social Network” and “Startup.com”).
Advice for other entrepreneurs who want to get started or are just starting?
Be part of an entrepreneurial community, like a startup incubator or a co-working for entrepreneurs. You will be surrounded by others like you, with similar interests and goals, that can support each other. The community brings you access to an entrepreneurial culture, talent, ideas, infrastructure, technology, funding, networking, expansion,
Keep up all of the bases of the Entrepreneur’s DNA: tenacity, instinct, pivoting ability, inspiration, perspiration, resilience, risk-taking, attention to detail, being competitive, fast decision making. If only one base falls, the possibility of failure increases.
Keep a balance between your professional and personal lives. Practise sports.
Enjoy the journey and let the guide be your passion for creating, innovating, and transforming. Do not be guided by the money or by being your own boss.
Are you looking to hire for certain positions right now?
We are continuously looking to attract the best entrepreneurs willing to make their dreams a reality.
Also welcome are investors-mentors that have entrepreneurial experience and want to invest in early-stage, technology-powered, exciting businesses.
Keep reading here: Starter Story